I understand your frustration. You deliver exceptional clinical care to your patients, while growing the business side of your practice has never been more challenging. In the 20+ years I’ve worked with aesthetic physicians and surgeons, I’ve never seen more clinical optimism and business pessimism.
Objectively, revenues from aesthetic medical procedures are at record levels and continue to grow, but this trend is not reflected within local practices. Despite following the traditional formula for business success and incorporating the latest digital technology, your efforts are not producing the results you desire. Individual practice numbers point to a troubling trend, (increasing costs combining with decreasing profit margins), however, financial metrics aren’t the only issue.
What about the things the numbers don’t measure? The challenges that come with being both doctor and small business owner/entrepreneur have gotten more complex. You’re working harder for less... Less money. Less satisfaction. Less freedom. Less. It’s easy to assign blame to the external market conditions, such as rapidly increasing competition and the evolving behavior of the modern aesthetic patient, but these conditions themselves are not the problem. We’re in the early stages of massive cultural change. The digital revolution has reshaped the business landscape in every industry and this new world has new rules. You’ve already evolved as a consumer, but has your own business evolved?
I will challenge your current business approach and you may find some of my assertions difficult to hear, but I promise you there is a happy ending to this story. As complex as it is, the modern business landscape has created incredible opportunities for you to grow your practice and achieve profitable, sustainable success. Capitalizing on these opportunities won’t require you to compromise how you practice medicine, nor will you be forced to choose between being a great doctor or having a successful business. However, it will require you to abandon the traditional model for aesthetic business growth, with its roots that date back to the 1950s.
This is the first in a series of articles created to help your practice grow and thrive in these complex times. If you’re expecting another essay promising “27 Easy Ways to Put Your Practice on STEROIDS!” prepare to be disappointed. You’re already inundated with promotions and online content assuring you that you’re only one new app, one SEO hack or one viral Instagram post away from massive business success. If those “quick and easy” approaches worked, you would’ve stopped reading by now. Some of the “instant success” advice out there may be well-intentioned and may work in the short term, however, it’s not sustainable or differentiated.
Long-term success in today’s environment will not be predicated on a massive investment in technology, but rather a commitment to a new business model based on fundamental concepts, addressing all aspects of your business, not just marketing. This won’t be a discussion of theory or a promise of rainbows and unicorns. I’ll present you with hard-core, proven business concepts that successful companies in hyper-competitive industries use to grow and thrive in this modern business world. All of which can be integrated into your practice.
The formula itself is simple, but not easy to execute. Why? Because it requires you to do something we all find difficult and uncomfortable. It requires you to change. The prospect of making transformative changes to the business side of your practice may sound daunting, but I assure you, doing so will produce transformative results.
Before you can improve, it’s critical to explore and understand why the traditional approach is not working and why change is the only way to achieve significant, sustainable results.
The evolving landscape:
We are in the midst of sweeping cultural change, brought on by the digital revolution. In every industry, unprecedented access to information has reshaped the business landscape, shifting the balance of power from companies to consumers. In his book, To Sell is Human, author Daniel Pink describes this as a movement from Caveat Emptor (buyer beware) to Caveat Venditor (seller beware).
At the same time, the aesthetic medical business is following the natural path of evolution, which impacts all commercial markets. Specifically, as it matures, an influx of new consumers makes the market more lucrative, which in turn leads to an influx of new suppliers. For companies that fail to evolve with the market, this increase in competition has the effect of slicing a large pie into ever smaller servings.
“The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday’s logic” –Peter Drucker
As difficult as this “perfect storm” of business conditions may be, the conditions themselves are not the cause of your business challenges. It’s the lack of adaptation to these new conditions. It is the continued use of traditional business methods and marketing messages in a landscape that has been comprehensively and irreversibly changed.
Consider this analogy. You may be familiar with Rip currents, which can form quickly on previously calm ocean beaches. These narrow, fast-moving channels of water move directly away from shore and are extremely dangerous for those caught unaware, resulting in thousands of lifeguard rescues and approximately 100 drownings per year.
What does this have to do with the challenges of growing your practice? Everything.
Contrary to popular belief, rip currents do not pull swimmers under the water. It is a lack of awareness that makes them dangerous. Unaware swimmers caught in a rip current react instinctively, aiming towards shore while using an approach that has always been successful. Failing to make progress, they naturally increase their effort, which causes them to tire, then struggle, making them vulnerable.
Escaping a rip current doesn't require superhuman strength. It requires an awareness of the new conditions followed by seemingly counterintuitive actions: swimming parallel to the beach to escape the current’s pull, before approaching the shore at an angle. While Michael Phelps couldn’t swim directly against a powerful rip current, any strong swimmer could escape, provided they have awareness, knowledge and take a new approach. The same is true for achieving business success in today’s environment.
You may feel this analogy doesn’t apply to you, pointing to your website, social media posts or latest software as evidence of your modern business strategy. However, the use of new technology does not mean you’ve adapted to the new environment. Technology is simply helping you deliver old messages more efficiently. You’ve upgraded your tools, but you’re using outdated methods.
Since I began my career in the aesthetic medical business in 1996, very little has changed in the fundamental way aesthetic practices approach their business. Before and after photos have moved from a binder in the reception area to a digital gallery on your website. The rack of manufacturer-provided patient brochures are now product specific website pages. The newspaper or magazine ad, promoting a “Spring into Spring”, “Fall into Fall”, “Sizzling Summer” or other offer is now a social media post. Meanwhile, patients have done more than change the technology they use to interact with companies, they’ve also changed their behavior.
Modern aesthetic patients aren’t new:
Technology hasn’t created a new aesthetic patient, it has empowered them. Price-sensitive patients, high-quality patients, narcissists, wonderful patients, crazy patients, etc. all existed before the internet and continue to exist now. The difference is how they use their new power to identify and select the best practice for them.
It’s critical to understand the journey (or process) aesthetic patients follow as they move from where they are to treatment (often a major life event: a milestone birthday, divorce, the trip of a lifetime, a job search, etcetera). In the pre-digital era, the process was fairly simple. Patients would typically respond to advertising or a media feature, which encouraged them to “contact our office for more information”. From the initial call to your office, through the consultation, you and your staff were the primary source of information and education for the patient. You met the patient at the very early stages of her journey and guided her along her path.
In contrast, today’s patient has access to a nearly unlimited supply of information. Her journey is longer and more complicated. You may be meeting a patient for the first time, however she’s often far along in her process. Using her power to “self-educate”, she has typically decided on a product (and her price point) before contacting your office. You and your staff are often forced to correct or re-educate potential patients rather than guide them.
Traditional marketing is ill-suited to the new “consumer/patient-centric” environment. The challenges are a function of both the marketing messages being sent and the business methods being used. Old-school marketing messages are “company/practice-centric” and typically emphasize similarities (i.e. branded products, time-sensitive promotions, pricing), rather than differences. This is a long-standing business approach, reflected in an economic concept called Hotelling’s Law. Developed in 1929, it states that as markets become more competitive, companies will move their message/positioning toward the “middle”, using similar language and product offerings in an effort to appeal to as many customers as possible. However, doing so makes it difficult for potential customers to easily determine differences among competitors, resulting in price becoming the determining factor.
At the same time, the methods used to deliver your messages are out of alignment with your patient’s journey. Traditional marketing tactics assume the message is reaching the patient at the beginning of her journey when in reality she’s very far along her path. It is also based on the outdated belief that she still follows the “two-step” process (read ad, then call office), ignoring the complexity of the modern evaluation process. By only connecting with her at the late stage of her journey, you're left with little opportunity to communicate the value of your practice and build a relationship with her. In addition, the patient has missed the chance to learn and benefit from your experience and guidance.
It’s easy to blame today’s patients as being too focused on brands and pricing, however, imagine yourself in her position. As a potential patient without a clinical background, how easy would it be to get lost in the vast ocean of information? How difficult would it be for her to determine key differences among the available products or comprehend the differences among credentials or specialties? As she glances through website homepages and social media accounts, will she be able to easily and clearly determine the right practice for her?
“When we are no longer able to change a situation, we are challenged to change ourselves.” –Victor Frankl
By now it should be clear that taking more of the same action won't produce substantially different results for your practice. While the traditional methods may still generate leads, its effectiveness will continue to decrease and its cost will increase. As competitors get more aggressive and patients have more difficulty differentiating among their options, procedure pricing will continue to be an issue, putting more pressure on profitability.
Without awareness, it’s understandable to rely upon tactics that have always worked. When this approach doesn’t produce the desired results, it’s intuitive to increase the volume and commit additional resources. Your challenges aren’t due to a lack of formal business education or a lack of resources. CEO’s of Fortune 500 companies are struggling to adapt to this modern business world.
Sears, Blockbuster, Toys R Us, Borders...each of these former “household names” had websites, social media accounts, and the latest technology. They all had significant brand awareness, access to vast resources and an army of well-educated MBAs advising them. All of these companies stayed committed to their traditional, legacy business model, even when faced with substantial evidence their approach was no longer working. Like swimming against a rip current, these businesses are gone because they resisted change and failed to adapt.
New environment, new opportunities:
I promised good news and we’re (finally) there. The digital age has given patients/consumers new power, but you are far from powerless. For all the challenges and complexities of the new business environment, it has created just as many opportunities for your practice. While technology has created unprecedented business transparency, it has also removed many of the traditional barriers to business growth. In the pre-digital era, your ability to increase awareness among patients correlated directly with your application of resources. Even with a significant budget, access was limited by the available channels (print media, TV, radio). Thanks to the widespread use of smartphones and other devices, access to today’s aesthetic patient is nearly unlimited and very inexpensive. In the new landscape, the business playing field has been leveled. It is no longer the practice that invests the most resources or “shouts the loudest” which will be rewarded, but rather the practice that can best identify, communicate with and deliver unique value to their ideal patient.
“In life, change is inevitable. In business, change is vital.” - Warren Bennis
Taking advantage of this incredible opportunity requires a new approach to your business. In the old economy, the concept of Caveat Emptor put the responsibility on the consumer to do their homework. Savvy customers protected themselves by learning as much as possible about the company and their products prior to doing business. Today, Caveat Venditor puts a similar responsibility on businesses. Successful companies are investing substantial effort into learning everything possible about their customer’s goals, needs, preferences and especially their buyer’s journey (or process). Those able to learn from these insights and adapt their business model (not just their marketing) to their customer’s new behaviors have a distinct competitive advantage.
Despite my call for change, you will not need to alter how you practice medicine, obtain a MBA in your free time or become someone you’re not. You have everything you need to succeed. Your future growth won’t be built by futuristic technology or exotic business strategies. It should be built upon a solid foundation of fundamental business concepts, allowing you to communicate and deliver your unique value to your ideal patients.
We’ll explore the implementation and detailed execution of these concepts in future articles. However, your journey towards implementing a modern business approach begins with developing a new mindset. To adapt and thrive in this new environment, start by thinking differently about what to prioritize in your business.
Reprioritize: Start with “Why”
“People don’t buy what you do, they buy why you do it.” -Simon Sinek
Simon Sinek has conducted extensive research to determine what separates extraordinary organizations and leaders from the average. He found a significant difference in the way elite organizations think and communicate. Typical organizations focus their messaging on “what” they do (products, procedures) and occasionally describe “how” they do it. In contrast, elite organizations start by communicating “why” they do things (their purpose/vision/mission), then emphasize “how” they do it (their process), and eventually “what” they do. While it may sound simplistic, this approach clearly differentiates these organizations from their competitors, while enabling them to attract, connect and build value with their ideal customers.
In my years of working with aesthetic doctors, I’ve seen and heard their passion as they describe how they were able to make a significant impact on their patient’s lives. I know you’ve had similar experiences. It is the emotional impact your skills and your practice have on your ideal patients that needs to move to the forefront of your messaging.
Leadership is more important than management:
“You manage things, you lead people” –Grace Murray Hopper Many doctors I meet, are seeking additional business education to help them better address the new complexities of running their practice. However, much of the information presented at conferences and seminars focuses on traditional management activities. While day-to-day operational management is important, development of your leadership skills will be much more valuable to your long-term success.
Strong leadership is a key component of high performance teams. Less common and more difficult to define than management, leadership skills can be developed and improved. Leadership isn't about authority, giving orders or having all the answers. Leaders achieve their goals by focusing on the team’s success: setting the direction; surrounding themselves with great teammates who share their vision; empowering and supporting their people; inspiring dedication rather than demanding obedience; creating a culture of accountability; and more.
Strong leadership is never more valuable than during times of change and turbulence. Change cannot simply be managed, it must be led.
People are more important than technology:
“Look after your staff and they’ll look after your customers” -Richard Branson
It’s a paradox of this digital age that technological innovation is creating the need for organizations to be more “human.” In the rush to adopt the latest technology and stay on the “cutting edge”, companies run the risk of allowing technology to create distance or barriers between them and their people. Technology should be used to increase the efficiency of your practice, however, over reliance on it can leave you vulnerable (for example: AI or Apps that communicate with your patients or devices that treat without staff involvement). Competitors can easily invest in newer/better technology. More importantly, people build loyalty to people, not products.
Your ability to attract, engage, delight and retain people will be critical to your success. When I say “people”, I’m referring to both your staff and your patients. Both are equally critical to your success and both require the same level of attention and support. As Richard Branson and other highly successful leaders believe, investing in your staff is even more important than your customers.
This isn’t a “soft”, “fluffy” admonition to “be nice to people.” I can provide you with a mountain of data showing objective results, both in financial success and quality of life, resulting from a commitment to your people. For example: Companies with engaged employees outperform their competitors by over 200%; their employees are more productive; generate more sales; and are more creative. On the customer side, 86% are willing to pay more for a better customer experience, while the majority will switch to a competitor over a bad experience.
Loyal, engaged employees will provide exceptional care for your patients, they’ll contribute to a low-stress/low-drama work environment and they won’t leave you for a higher salary offered by a competitor. Loyal, engaged patients will spend more on your services, reject aggressive discounts/offers from your competitors and become ambassadors for your practice. Investing in people, both your staff and patients, delivers a substantially higher return than any marketing campaign.
Communication is more important than marketing:
“Finding new ways, more clever ways to interrupt people doesn’t work.” - Seth Godin
Technology has given you an incredible gift. As outlined earlier, the traditional barriers which limited access to your patients no longer exist. To take advantage of this opportunity you're encouraged to “create more content” and “engage with your patients”. But how? What digital channels should you focus on? What format (video, audio, written) should you use? Most importantly, what should you say?
The modern formula for successful marketing is nearly the exact opposite of traditional methods. Traditional marketing is company-centric, using generic messages in an effort to appeal to a wide audience, with the goal of incentivizing or “pushing” the prospect toward the business. In comparison, effective modern marketing is patient-centric, focused on the patient’s needs, using personalized messages to a specific audience, creating trust by aligning those messages with the patient’s journey, effectively “pulling” customers toward the business by communicating practice's unique value to the patient.
On the surface, digital technology and channels may seem complex, but leveraging their power to effectively communicate your value to your potential patients follows some simple rules. Communicate “digitally” as if you were communicating to someone in-person. For example, if a potential patient was in your office, you would speak directly and specifically with her, not “females 30-65 years old”. You’d begin by understanding what her needs are and where she is in her journey. If she was early in her process, you’d likely start by providing advice and guidance rather than a sales pitch. You’d likely tailor your presentation based on what you learned from her and how you could best help her on her journey. As she progressed through the process she would build trust and value in you. Digital communication follows a similar process.
As to the questions of what content, in what context, on which channels, your best patients have all the answers you need. Your “best” patients are certainly not every patient, neither are they necessarily the patients who spend the most. The best are patients who value you and your team, who are a pleasure to serve and who have friends like them. Identify them. Learn from them. What do they want? Where do they go online? What content do they like? How could you help them? Build your messaging around the insights you obtain. Effective communication is as much about listening as it is about speaking.
Long-term success requires long term thinking:
“Have you ever been too busy driving to take time to get gas?” -Stephen Covey
I know you want to make changes that will have an impact right now, not two-years from now. Short-term success can’t be ignored and there are many activities which you can incorporate to produce quick results while you build your strong foundation. However, it’s important to focus short- term effort and energy on activities which will compliment your long-term goals. Focusing exclusively on short-term gains can often have a negative impact if not aligned with your long-term goals (attracting the wrong patients, driving away key staff, increasing costs, etc.).
Investing in a new approach takes courage, time and consistency. However, in contrast to short-term campaigns, the long-term investment in your foundation will provide compound returns, growing in value and decreasing in cost as you progress.
The power of transformation:
This thinking is counterintuitive to traditional business teaching and the process of change may seem difficult, but allow me to share an example of what’s possible. Zappos struggled to sell shoes online before Tony Hsieh joined the company as CEO. He changed the focus of the company from “what” they sold to “how” they sold it. Hsieh clearly communicated the company’s “why” (delivering exceptional customer service). Zappos accomplished this not through their commitment to customer service directly, but through their commitment to building an exceptional company culture. Hsieh knew great people would deliver legendary customer service. Zappos grew from zero annual sales to over $185 million in 4 years and over $800 million in 7 years. Amazon purchased Zappos in 2009 for nearly $1 Billion. This success wasn’t achieved by creating groundbreaking technology or innovative products but by selling shoes online. SHOES! Zappos succeeds in a highly competitive industry through strong leadership, a clear “why”, focus on their “how”, knowledge of their ideal customer, investing in their people/culture and delivering an amazing customer experience.
In any industry, there are companies who will gain a competitive advantage by introducing a breakthrough product, creating a successful marketing campaign or establishing a strong presence on a social media channel. However, markets will continue to evolve at an incredible pace and these advantages are typically short lived. New technology will arrive. Customer attention will move. Change is constant and moving faster than ever.
Companies that achieve profitable, sustainable success, do so by investing and focusing on their foundation. These efforts take time and commitment, but the results are evergreen. They work in every industry, in every economic climate, in companies of every size. You have everything you need to achieve your unique definition of success. You won’t need to change everything in your practice, just your priorities and focus. Achieving transformational results starts with transforming your mindset.